If you want to exclude a contractual liability, you need to be clear in your drafting. If not, the court may construe the exclusion clause narrowly. That is the message from the Court of Appeal in Nobahar-Cookson v The Hut Group Ltd.

After discussing the Latin tag contra proferentem and what it might mean, the Court considered the principle that, if necessary to resolve ambiguity, exclusion clauses should be narrowly construed, including in relation to commercial contracts. This is because an exclusion clause cuts down or detracts from an important contractual obligation or a general law remedy. The parties are not lightly to be taken to have intended to cut down legal remedies for breach of important contractual obligations without using clear words to that effect.

This approach to exclusion clauses is not now a presumption or a special rule justifying giving strained meanings to exclusion clauses. Commercial parties can allocate the contractual risks in any way they choose. Nor is the approach to be mechanistically applied to an ambiguous exclusion clause. The court must still use all its tools of linguistic, contextual, purposive and common-sense analysis to discern what the clause really means.

Nobahar-Cookson & Ors v The Hut Group Ltd [2016]  EWCA Civ 128